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What a Connected Fleet Means to Avis (and Car Rental)

Within three model years, automakers such as Ford pledge that 90% of new models will be connected. (Photo via Safercar.gov)

All vehicles will be connected someday — to their owners, each other, and the amorphous, all-powerful “grid.” This connectivity will revolutionize transportation, even though we won’t yet grasp its full impact until we’re well past full connectivity.

For auto rental, a milestone on this journey is Avis Budget Group’s announcement to connect 50,000 rental units with telematics technology. To be sure, car rental companies have been using telematics to track fleet vehicles for years, and the technology is inherent in carsharing models, including Avis subsidiary Zipcar. Yet this initiative is noteworthy in its scale — to create a global car rental fleet, says Arthur Orduna, Avis Budget Group’s chief innovation officer.

He says the goal, however, is not to explode the traditional car rental model tomorrow, but rather guide its evolution into a continually refined user experience.

The changes will happen incrementally, from the low-hanging fruit of applications available today to the big picture of a connected future. “The ‘tip of the tip’ of the iceberg is self-service and counter bypass,” Orduna says. “What we’re talking about is a data-driven ecosystem.”

How does a connected fleet manifest in the near future?

The Avis connectivity model provides real-time location, odometer readings, and fuel measurement, engine diagnostics, and remote vehicle access. It also provides a way to communicate with the renter.

The technology would allow the digitally authenticated renter to switch or upgrade to a specific car while on the runway, bypass the counter, and then bypass the parking lot checkout kiosk. “This builds on what we provide today to our Avis Preferred customers and (those using) the Avis Now app,” Orduna says.

Shortening vehicle pickup and drop-off times and sidestepping long counter lines — a CSI backbreaker — would free up Avis personnel to act more as ambassadors, Orduna says.

Without traditional over-the-counter interaction, some worry that sales of ancillary products and services would slip. While Avis is learning how those sales will translate into the digital realm, the real opportunity is to leverage communication with the renter during the actual rental.

“A connected experience creates new categories of ancillary services that are accessed, transacted, and fulfilled as part of the digital ecosystem,” Orduna says.

Obvious opportunities lie in location-based services, such as connecting the renter to tourist attractions or the highest-rated boutique coffee shop based on their “geo-fences.”

Rental contract information and location could be mashed with fuel level to notify renters of a discount from a nearby fuel provider, along with turn-by-turn directions. If the renter is about to turn in the car, the reminder could also help avoid a refueling fee.

In a truly connected environment, the vehicle connects not only with retailers but also a city’s public services to warn of construction or places to avoid. “We can start mixing all of those together,” Orduna says. “That’s really powerful.”

Internally, a connected, geo-located fleet allows for better fleet management — anticipating fleet needs at a certain location and using the data, in aggregate, to pinpoint services and price accordingly.

Looking out further, many uses aren’t yet known. That’s okay; the point today is being ready to take advantage. “(The technology) gives us the flexibility to experiment to see how this will evolve, and understand how these digital on-demand services will be consumed,” Orduna says.

This constantly evolving path may end up with a large percentage of traditional car rental fleets morphing into a free-floating, carsharing model, such as car2go and Zipcar Flex in London. Yet the immediate goal is to better manage the fleet and improve the user experience. With that, greater loyalty and new revenue opportunities will follow.

“We want the customer to say, ‘wow, that was really cool, that was really convenient,’” Orduna says.

When we’re in the middle of a hype maelstrom, it’s hard to separate the fads from the revolutions. Fleets don’t need to be first adopters, but those forming their strategies now will able to take advantage of the truly transformative solutions.